Globally, mergers and acquisitions are very common as business organizations expand and enhance their competitiveness and operations. The underlying assumptions in the formation of mergers and acquisitions are that the resultant merger or company has a greater value than individual companies merging. However, despite the optimistic expectations of the corporate acquisitions and mergers, the frequency of failure for this endeavor seems very likely (Pikula, 1999). This has mainly been attributed to the focus on the financial transactions as well as the strategic issues surrounding this corporate activity and neglecting other critical success factors such as human resources. Often when corporate mergers and acquisitions are taking place, organizational cultures and the roles of employees are put on the margin, and most concentration is given to financial and strategic planning. However, research has proved that corporate culture and human resource issues should also be considered significantly to increase the possibility of a successful combination of the organizations. This essay is an examination of how human resource issues were adequately managed during the acquisition of Time Warner by Charter Communication. This paper is a precise assessment of how this acquisition impacted the human resource function in the resultant large business organization. It accomplishes this by explaining the purpose of this acquisition, assessing the personnel involved in the change, determining the change implementation methods with due consideration to time, budget and measurement constraints. The essay will then recommend a follow-up plan for reviewing the impact of human resource function, organizational alignment, and personnel requirements.
Purpose for the change
Recently, the Federal Communications Commission in the United States approved the merger between Times Warner Cable and Charter Communications subject to fulfilling certain terms such as prohibiting data caps for consumers as well as charging customers fee to online producers of content such as Netflix for the next seventy years (McKinnon, 2016). The resulting company was renamed New Charter, which was loaded with a mandate of building the high-speed internet for more than 2 million American homes and offering broadband services to American household that are categorized as low-income earners (McKinnon, 2016). The deal effectively created America's second largest internet service provider as well as the third largest cable television programming provider. While some critics argued that the deal would most likely alter the abilities and incentives of the company which could potentially harm the public interest, others argued that the new corporation would adhere to consumer-friendly approach so as to reduce the possible harm to the public interest (McKinnon, 2016). However, the primary motivation for this merger was to guarantee benefits and confidence to the people who would likely promote the public interest and outweigh the named anticipated harm to the public. The resulting organization according to the managers would serve the public more efficiently, enjoy a large capital base, technical skills, reach a new market, and skilled, diverse and talented workforce. The merger would also consolidate the technology market ensuring that only large companies with technical capabilities would operate in the market.
Personnel involved
Change in management typically during company mergers involves both the human resource department and the top management. The senior management has the responsibility of strategically formulating policies that need to be followed during the Times Warner Cable and Charter Communications merger process. The strategic plan is meant to ensure that skills and workers are identified, job descriptions done, and recruitment policies merged for the two organizations (Kavanagh & Ashkanasy, 2005). On the other hand, the human resource personnel is required to implement the human resource policy that has been developed by the top managers. They are also supposed to give updates and vital information to the companies’ workers during the merger process promptly thus ensuring that their fears are alleviated, and employees remain motivated. The human resource personnel is also mandated to hire and train new and existing employees on the new structures of the new company.
Change implementation methods
In the case of Times Warner Cable and Charter Communications, the anticipated organizational changes include mission changes, strategic change, structural and operational changes, technological changes as well as behavioral and attitudinal changes of the personnel. This is in addition to countering the resistance of the employees to change and aligning them to the new overall strategic direction resulting from New Charter Inc. all these changes are the building blocks of an organization and must be dealt with strategic precision. For employees, the readiness factor for the anticipated change acts as the bridge between identification of what is to happen and the whole activity of implementing change. Human resource management during change management includes encouraging the affected employees to be committed and remain loyal to the larger company. This induced compliance and loyalty would, in turn, increase their performance, the emphasis on workers' adherence to quality standards while at work and ensuring their flexibility. The resultant outcome would be the creation and retention of employees who are receptive and adaptive to the likely changes such as working methods and working hours (Osibanjo, Adeniji & Abiodun, 2005). This merger can implement the following change management practices;
Effective communication and training: Mergers between companies are often characterized by widespread confusion mainly resulting inadequate information and rumors. This can be alleviated if the concerned human resource departments of the two companies making use of open communication channels to their employees. This includes timely updates on the merge steps so that employees get a clear understanding of what to expect at each stage of the merger. Effective communication strategy is best done through group meetings and written communications where employees are given forums to give their feedback. It’s done so as to inform the relevant stakeholders why changes are taking place, benefits of the merger and how the employees will be affected.
Integrating existing human resource systems: This ensures that there is a creation of a corporate human resource function that allows uniform human resource framework across the new organization. A standard human resource policy is created by integrating the content of Times Warner Cable and Charter Communications clearly outlining human resource practices such as work systems, office timings, benefits, travel, business conduct, and exit.
Creating job descriptions: in this method, detailed job descriptions are developed for all unique roles of New Charter so that integrated employees understand their roles and responsibilities which they will be responsible. This serves to ease the smooth operations of the new company and is typically prepared when incumbent workers are interviewed.
Change management measurement
The change management process for human resources during the merger of Times Warner Cable and Charter Communications involves implementing a creative marketing strategy to communicate with the employees to be affected by the merger so as to bring a profound social understanding of the new organization's dynamics as well as the leadership style. As such, the change management process entails transforming the behavioral tendencies of the employees as well as aligning the expectations, and communications of the employees. This is done through frequent training, incentives and other forms of incentives that operate within the budget before the employees start to leave because of fears. The change management process in an organization is measured through performance metrics namely, financial results, leadership commitment, employee attitudes, operational efficiency, communication effectiveness as well as perceived change design and strategies that avoid failures and trouble in the merger (Osibanjo, Adeniji & Abiodun, 2005). This is an addition to employee cooperation.
Follow up plan
Change management follow-up plan for Times Warner Cable and Charter Communications merger will specifically include evaluating the effectiveness of job descriptions that have been created by the new organization and determining which roles are redundant, roles that need to be filled so that new employees can be hired through a comprehensive recruiting and vetting process and training them. The follow-up plan also measures the extent of workers job satisfaction, compensation program and how to carry out termination for employee positions that are redundant (Pikula, 1999). Through this process, the human resource department will gradually alter the organizational structure of the new company so as to integrate the new reality.
References
Kavanagh, M. H., & Ashkanasy, N. M. (2006). The impact of leadership and change management strategy on organizational culture and individual acceptance of change during a merger. British Journal of Management, 17(S1), S81-S103.
McKinnon, A. (2016). Charter Communications Completes Acquisition of Time Warner Cable. WSJ. Retrieved 29 June 2016, from http://www.wsj.com/articles/charter-communications-completes-55-billion-acquisition-of-time-warner-cable-1463581387
Pikula, D. A. (1999). Mergers and acquisitions: organizational culture & HR issues. IRC Press.
Osibanjo, O. A., Adeniji, A. A., & Abiodun, J. A. (2013). Organizational change and human resource management interventions: an investigation of the Nigerian banking industry. Serbian Journal of Management, 8(2), 139-154.
